How Do Podcasts Make Money?

When traditional sponsorships are out of reach, how do new podcasters make money podcasting?

What types of podcasts make money?

Podcasting is a lucrative business idea with some top podcasters even signing huge deals for their show. Take Joe Rogan’s recent deal with Spotify to handle ads and distribution, for a reported $250 million, as an example.

The truth is not all podcasts make money. There are more than two million podcasts in the world, but almost half (44%) never make it past three episodes. Consistency is clearly an issue; as many creators give up early because only a select few shows make large sums of money.

For this reason, the most profitable podcasts usually fit one of these molds:

Podcasts with established followings. Three of the highest earning podcasts—The Joe Rogan Experience, Crime Junkie, and The Daily—each have a broader audience of more than 10 million monthly downloads. It makes sense: brands will pay more to advertise on a show that can expose them to a larger audience.
Podcasts that target niche audiences. You don’t have to talk to everyone with your podcast. With uber-specific podcast topics, you can charge brands more money to reach their smaller but more specific target audience. Chapo Trap House, for example, earns around $180,000 per month from its comedy political-themed show.

How to make your podcast monetizable

Monetization doesn’t come as soon as you start a new podcast. Even if you have a library of podcast episodes spanning the past few years, you need to put in work to reach the higher echelons of podcast monetization.

Before you start searching for ways to earn money podcasting, set yourself up for success by doing these five things: 

1. Get clear on your subject matter. The most successful podcasts know exactly who they’re talking to. Research your target audience and get crystal clear on what they want to know, then record podcast episodes that addresses their goals, presents solutions to their challenges, or covers and piques their interests. 
2. Follow a consistent posting schedule. The best way to build a connection with supportive listeners is to make it easy for them to tune in. Aim for at least one new podcast episode each week. This will help your show become a regular part of a listener’s weekly routine. 
3. Grow your podcast audience. Traditional sponsorships tend to be out of reach for new podcasters because businesses are less willing to risk investing in a podcast without an established audience. The more people you have tuning into your show, the better chance you have at selling big ticket sponsorship packages. 
4. Improve listener engagement. Monthly downloads isn’t always the highest priority metric when brands decide which podcasts to sponsor. Engagement rate, listener retention, and review ratings are all positive signs people listen to what you have to say. Only then can you sell branded ads and promote products.
5. Get feedback from your audience. The last thing you want to do is start monetizing your podcast and turn off your audience. Before monetizing, get feedback from your audience to anticipate how they’d respond to each strategy. If listeners say they’d get annoyed if they had to listen to an ad before your show, perhaps podcast advertising isn’t the right monetization model for you. 

“Focus on creating compelling content that a listener would want to share with their friends and family,” says Toronto Mike Boon, host of the Toronto Mike’d podcast. “People love telling their circle of influence about that new indie podcast they’ve discovered. Build your audience in an authentic and sustainable way, engage with your listeners as a community, and businesses will want to be a part of it. 

“The overwhelming majority of Toronto Mike’d sponsors started because a passionate fan of the podcast championed the partnership from within the company.”

How To Start a Podcast In 5 Steps

If you’re interested in starting a podcast but don’t know where to begin, completing the following steps will set you up for success.

1. Define Your Niche or Topic

Narrowing down a topic or niche may seem limiting, but doing so will help you better focus your content and build an audience in the long term. It will also help you build trust and more definitively establish yourself as a subject matter expert.

Pick a topic that’s broad enough that you could reasonably talk about for multiple episodes, seasons, etc., but specific enough to draw in a certain type of person or demographic.

Research Existing Podcasts

Before you dive into recording your first episode, it’s a smart move to do a little digging to see if there are any other podcasts that are similar.

You may find that there are few to no podcasts on your selected topic, or that your niche is already pretty crowded. Even if it’s the latter, doing your research can help you figure out how to position your podcast in a way that sets you apart.

Choose Your Format and Cadence

Your podcast can be a solo act or a group one—the choice is up to you. If you want to host your podcast alongside someone else, you’ll need to coordinate how to do so effectively. In a similar vein, if you want to interview guests on your show, you may need to do some initial outreach.

Your cadence is your publishing schedule, i.e., how often will you release a new episode. Some podcasts release new episodes every day, while others release episodes biweekly. You’ll need to determine the best cadence for your schedule. Adhering to whatever cadence you’ve set will help build trust and familiarity with your future audience.

Define Your Audience

Arguably the most important question you’ll need to answer before creating your podcast is: who is this podcast for? Having an ideal listener in mind will help you create content that is both valuable and relevant. Try to nail down basic information about your ideal listener, such as:

• How old are they?
• Where do they reside?
• What do they do for work?
• What forms of media do they already consume?
• Do they already listen to any podcasts?
• What do they do in their spare time?
• What problems do they commonly face?
• What do they wish they knew more about?

2. Build Your Brand and Online Presence

Naming your podcast is a hugely important step. You want your podcast’s name to relate to your subject matter or likeness, as well as be clever or memorable. Avoid using the word “Podcast” in your show’s name—it’s redundant and takes up valuable character space.

Speaking of character space, strongly consider the total length of your title. Longer doesn’t necessarily mean better. In fact, a study by Pacific Content found that most podcast titles are 29 characters or fewer.

In addition to a title, you’ll need to spend time creating your branding elements. Branding elements encompass your show’s cover art, color palette and any custom design or audio work.

You can design your cover art yourself using a free design tool such as Canva, or hire a professional graphic designer to help you capture exactly what you’re looking for.

For custom audio sounds, such as intro or outro music, you can work with a professional musician or studio. Otherwise, you can find sounds that fit your style and vibe from a royalty-free music library.

Create a Website or RSS Feed for Your Podcast

Now that you have an episode or two of your show recorded, you’ll need to make it accessible. One way to do this is to create a website for your podcast. You can build a website using free or paid tools, but we recommend opting for paid ones if you know you want to have more customization options and a professional feel. On your website, you can host download links or embed your episodes so that others can listen and enjoy.

Another option is to create an RSS feed using a podcast-specific hosting site (such as Anchor or BuzzsSprout) instead of a traditional web host (such aslike WordPress or Wix). The term “RSS feed” might ring a bell if you blogged in the earlier days of the iInternet. Modern podcast distribution software still relies on solely on RSS feeds, but you don’t need to have a full- blown website in order to submit your podcast to Apple, Spotify, or other directories.

There are many companies that will host your podcast and create an RSS feed for you for free or at a low cost. All you’ll need to do is upload your episodes and basic information, and you’ll have an RSS feed that you can then use to submit to podcast directories.

Create Social Media Profiles

Typically, if you’re starting a podcast you will want to create social media profiles using the name of your podcast. While it might be appealing to create a profile on a number of different platforms, it’s worth considering which your audience uses most and focusing on those. This is because social media can provide a great marketing opportunity, but only if you actually use it.

Set Up an Account With a Podcast Platform (i.e., Spotify)

This step is optional, but highly recommended if you want to reach as many listeners as possible. To make your podcast more discoverable, you can submit it to a directory. Most major directories rely on your podcast’s RSS feed to verify its legitimacy and ownership, which is why you’ll need to make sure you have one in place beforehand.

Some of the most popular podcast directories worth submitting to are:

• Apple (formerly iTunes)
• Spotify
• Stitcher
• Audible
• Google Podcasts
• iHeartRadio

After your podcast has successfully been uploaded to a directory, anyone who uses the directory will be able to find your podcast if they search for it by title or keywords.

3. Source Recording Equipment and Editing Software

It’s very likely that you can record audio using the computer, tablet or phone you already have. However, for a better, clearer sound, most podcasters recommend investing in a separate podcast microphone. Podcast microphones can cost as low as $20 to as much as $10,000.

You don’t need to pay for podcast editing software if you don’t want to or are unable to. GarageBand is a great free option if you have an Apple device, and so is Audacity, which is free on any device. Otherwise, you can invest in more advanced, premium software such as Adobe Audition, Logic Pro X or Hindenburg Journalist.

If you don’t feel comfortable or have no interest in editing your podcast, outsource it to a freelancer. You can find a freelance podcast editor to work with through sites such as Fiverr, Upwork, Craigslist or Facebook.

4. Record and Edit Your First Podcast

Once you’ve nailed down your equipment, you’re ready to record. Some podcasters write scripts beforehand so that they know what to say ahead of time, while others wing it. The choice is up to you.

Even if you write a script, you’ll likely have to take breaks, pause, re-record and/or edit your audio to produce a final, polished version. As with anything else, the more you do it, the better you’ll get. Podcasting is a skill in itself that takes time and practice to do swiftly.

Name Your Episode Titles

Each episode you record should have a unique name. Your episode titles should accurately describe what the episode talks about and, if applicable, who the guest speaker on the episode is.

While it may be tempting to create clever or witty names for your episodes, it’s more strategic to name your episodes aptly and accurately. Doing so will aid your podcast’s SEO, meaning it will be easier for listeners to discover your podcast in search engines or on podcast directories.

Craft a Compelling Show Description and Episode Descriptions

To tell potential listeners what your show is all about, you’ll need to write a general synopsis as well as descriptions for each of your episodes. For your general synopsis, be as clear and concise as possible while answering these basic questions:

• What is your podcast about?
• Who is your podcast for?
• What can listeners expect to hear?
• Why should people listen to your podcast? What will they gain from listening?
• How often/when do you release new episodes?
• How/where can people connect with you other than by listening to your podcast?

Your episode descriptions should be similarly concise, but you’ll have the opportunity to insert relevant links to resources, products or anything else you talk about.

Submit Your Episode to Directories

Once you have your podcast ready to go, the next step is to submit (or upload) it to your podcast platforms of choice.

5. Promote Your Podcast

Once your podcast can be discovered and downloaded, it’s time to spread the word about it. You can take a grassroots approach, such as sending direct links to your close friends and family, creating a paid social media ad campaign or anything in between—the choice is yours.

One popular method of publicizing your podcast is via social media channels such as Instagram, Twitter, Facebook and TikTok. If you already have an established following on social media, you can use your existing accounts to promote your podcast. If not, you can create new accounts for the sole purpose of promoting the podcast and connecting with your community.

How To Make Money With a Podcast

There are many ways to make money with a podcast. There are some methods you can leverage successfully without a large following, while others require demand and viewership in order to work. Regardless of which avenues you choose, it’s important to have more than one stream of revenue as a podcaster. Having only one source of income will put you at greater financial risk.

Sponsored Ads (or Episodes)

If you’ve ever listened to a popular podcast, chances are, you’ve heard a podcaster read through a sponsored advertisement. Some companies will pay you to read a brief script on your podcast that promotes their product.

Ads can be a relatively easy way to make money, but often require a larger listenership and detailed demographic data. Companies will want to ensure that your podcast is a great fit for their ad by looking at how many listens or downloads you have, as well as information on who your audience is.

Affiliate Codes or Links

As an offshoot of sponsored ads, brands that you run advertisements for may also give you an exclusive discount code for your listeners to utilize. You may then earn a small commission each time someone enters your discount code at checkout when they make a purchase.You can also publicize affiliate codes in your show notes and across social media to encourage more uses.

In a similar vein, you can earn commission via affiliate links. As with codes, you’ll earn a small sales commission each time someone clicks on your link and makes a purchase. Some popular affiliate networks you can join are Amazon Associates, LTK and Skillshare.

Promoting Your Services or Products

You can drive more sales to any existing services or products by talking about them on your podcast. Hearing you explain what you offer and how it can benefit your audience is a fantastic way to educate listeners and push them closer to making a purchase.

Consulting or Coaching

As a subject matter expert, your industry knowledge may be in demand beyond the free information you give on your podcast. You can use your podcast to book consulting or coaching clients, i.e., people who want to learn from you in a more customized way.

Accepting Donations or Tips

Running a podcast takes time and effort. To help offset the costs of producing each episode, you can simply ask your listeners to tip you or donate money to you. You can collect donations via platforms such as Venmo, Patreon or GoFundMe.

If you solicit tips or donations, try to be as specific as possible as to where the money is going, e.g., buying a new microphone for better sound, hiring an intern to ramp up production, etc.

Gated Content or Memberships

Podcasts are typically free to listen to or download, but one way to make an income is to create additional episodes that sit behind a paywall. That way, a listener needs to either pay a one-time amount or subscribe to a premium membership in order to access the additional content.

Patreon and Buy Me a Coffee are popular platforms for hosting subscriber-exclusive content.

Advertising Networks

A podcast advertising network acts essentially as an agent for your podcast. Advertising networks have connections with brands and can help you land opportunities you may not have otherwise come across on your own. Some networks let you reach out to advertisers directly once you’ve joined, while other more premium networks can pitch to advertisers on your behalf.

Some examples of podcast advertising networks include AdvertiseCast, PodcastOne and Megaphone. Keep in mind that you may need to fulfill certain requirements in order to join an advertising network, such as a minimum subscriber count.

Selling Merchandise

Depending on your branding and audience, you could explore selling branded merchandise with your podcast’s logo, iconography or signature phrases. For example, if you have a podcast about getting organized, selling a planner with your logo or phrasing on it could be a sizable way to generate income.